Credit Score in Louisville>Question Details

Michellew402…, Home Buyer in

I just filed bankruptcy and I am working on my credit. What areas should I concentrate on?

Asked by, Tue Jul 2, 2013

I currently own a house, which was not in foreclosure. Our family has grown to much since we bought our house, so we need to get our credit together as fast as possible. If you have any ideas please help. Thanks so much. Michelle

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David hit the nail on the head. Make sure that you check your credit reports approximately 45-60 days after your bankruptcy has discharged. You will want to go over your credit report with a fine tooth comb to make sure that every account you discharged under the bankruptcy is reporting as such. Often times, tradelines may report incorrect account balances, incorrect statuses, and incorrect payment histories. Make sure that every account you discharged in your bankruptcy is reporting a status of "included in bankruptcy" and that every balance is $0. You may also have the option (depending what state you are in), to contact the credit reporting agencies and request that they delete the payment histories of the accounts, leaving just the bare bones account info.

Good Luck With Your Fresh Start!!!
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0 votes Thank Flag Link Fri Aug 9, 2013
Good luck Michelle. Let me know if you have questions.
0 votes Thank Flag Link Thu Aug 8, 2013
Thank you all so much for the helpful answers. Hopefully soon in the future we will be able to move into our not so cramped dream home.
0 votes Thank Flag Link Fri Jul 5, 2013
Pay on time

"Be extra careful to make each [of] your minimum payments on time each month," says Barry Paperno, product support manager for FICO, inventor of the FICO score. "If you're late making payments now, bring them current immediately and keep them current." Your payment history makes up the largest part of your credit score (35 percent), and it takes longer to raise your score after late payments than it does for some other issues.

Pay down debt

Since the FICO formula looks at your credit card limits and balances, both individually and in total, shifting balances around won't make your bottom line look any better. Instead, you'll want to pay down balances while continuing to use the cards, says Paperno. Ideally, you'll want to aim for a utilization percentage, both individually and in total, of under 10 percent. That means you're using less than 10 percent of available credit on any one of your cards.

Don't close accounts

Length of credit history is another important part of your credit score, so closing old accounts could actually hurt you. That's because potential mortgage lenders want to know you've been responsible with credit for a good long time. Keep older accounts active by making small charges on each one at least every few months and then paying those charges off right away, advises Paperno. "Using your cards regularly keeps them active, which ensures that your credit limits on these cards continue to be open and included in your credit utilization. Contrary to popular belief, you won't be penalized for having lots of available credit.
Joel Lobb (NMLS#57916)
Senior Loan Officer
502-905-3708 cell
502-813-2795 fax

Key Financial Mortgage Co. (NMLS #1800)*
107 South Hurstbourne Parkway*
Louisville, KY 40222*
0 votes Thank Flag Link Fri Jul 5, 2013
Joel Lobb
Senior Loan Officer

American Mortgage Solutions, Inc.
800 Stone Creek Pkwy, Ste 7,
Louisville, KY 40223

phone: (502) 905-3708
Fax: (502) 327-9119

Company ID #1364 | MB73346
Tips for Raising Your Credit Score

• Pay your bills on time
• If you have missed payments, get current and stay current
• Be aware that paying off a collection account will not remove it from your credit report
• If you are having trouble paying your bills, contact your creditors or see a legitimate credit counselor
• Keep balances low on credit cards and other revolving credit
• Do not have too many credit cards and do not use them maximum credit limit on any of them
• Pay off debt rather than moving it around
• Don’t close unused credit cards as a short-term strategy to raise your score
• Don’t open a number of new credit cards that you don’t need just to increase your available credit
• If you have been managing credit for a short time, don’t open a lot of new accounts too rapidly
• Do your rate shopping for a given loan within a focused period of time
• It is OK to request and check your own credit report
• Apply for and open new credit accounts only as needed
• Have credit cards – but manage them responsibly
• Closing an account doesn’t make it go away
Flag Sat Feb 14, 2015
its going to take about two years to recover. It is recommended that you re establish credit in a positive way. Bankruptcies are easier to work with verses collections after bankruptcies. Lease options may work for you if you able to pay the fee to enter. Those can be re financed into a regular loan.
0 votes Thank Flag Link Wed Jul 3, 2013
There are a couple of non profit organizations that will help you with this. Very reputable and they don't charge a dime. Give me a call at 502-254-9600 and I'll see which one I think suites you best and refer you to it.
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0 votes Thank Flag Link Wed Jul 3, 2013
You should concentrate on not getting future debt. You proved you were unable to handle past debt. For now try to save money instead of spending more money than you bring in. That is a good first step.
0 votes Thank Flag Link Tue Jul 2, 2013
Ok. Thanks. I have seen different people online saying they got a home loan in as little as 6 months after their discharge. They built their credit and got approved. I'm sure it probably wasn't a good interest rate, but couldn't I refinance in a couple years?
0 votes Thank Flag Link Tue Jul 2, 2013
A few months from now it would be beneficial to double check that any accounts on the credit report that were included in the bankruptcy are showing as such. They should update automatically, but that's not always the case. The key is to establish new credit as quickly as possible to help your credit score.

The guidelines begin with the discharge date. FHA requires a minimum of two years from then and Fannie Mae (conventional mortgages) requires three years to have passed.
0 votes Thank Flag Link Tue Jul 2, 2013
Apparently, your Attorney did not explain the rammifications of filing BK.
0 votes Thank Flag Link Tue Jul 2, 2013
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